DURBAN Chamber of Commerce and Industry President, Nigel Ward, has commented on the State of the Nation Address (SONA) 2021, stating the Chamber commends government for its unwavering focus on the preservation of lives as a primary objective in the ongoing pandemic context.
The Durban Chamber highlighted topics discussed in the SONA, including issues such as infrastructure, Eskom, state-owned enterprises (SOEs), the Port of Durban and corruption. Commenting on infrastructure, Ward said the Durban Chamber applauds the president on committing resource towards the N3 highway.
“The KZN economy is extremely reliant on the logistics sector, with the N3 corridor being a major trade route connecting our two harbours to the SADC region. It is our hope that the transportation and logistics sector will thrive with the new upgrades,” he said.
Ward said the Durban Chamber believes there is an urgent need to reform and diversify South Africa’s energy sector, and regarding Eskom, the Chamber is pleased by President Ramaphosa’s announcement that government will action crucial steps that will enable to revive Eskom.
“We are, however, concerned about the forecasted electricity supply shortfall over the next five years which will be detrimental to the economy and energy-dependent businesses. The business community anxiously awaits government’s timeline for the implementation of the promised initiatives and plans, including proposals on how organised business can support the government to action these plans,” he said.
He said SOEs hold a significant position in South Africa’s economy, playing a leading role in several crucial sectors such as utilities (electricity and water), transport (air, rail, freight, and pipelines) and telecommunications. However, despite being vital to national socio-economic agenda, South Africa’s SOEs are in a state of financial and operational collapse, suffering from chronic mismanagement, plagued by ongoing corruption and characterised by a complete lack of adherence to effective governance and compliance frameworks.
“This is severely impacting the country’s economy and investment profile as well as negatively affecting our country’s growth and development prospects. We are encouraged to note that government will be implementing a centralised SOE model which will ensure a standardised governance, financial management and operational performance framework for all SOEs and look forward to receiving progress reports concerning the effectiveness of this approach,” said Ward.
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The Durban Chamber noted the President’s remarks to reposition Durban as a hub port for the southern hemisphere.
“While this sounds promising, we believe there is an urgent need to attend to port security, operational inefficiencies and the competitiveness of the Port of Durban. Timelines on resolution are key in this regard. Furthermore, the decision to relocate Transnet head office to the Eastern Cape does not appear to support the President’s remarks. We believe that a more rigorous and transparent approach should have been employed to identify the ideal location for Transnet’s new head office, informed by a sound assessment of where each city’s relative competitive advantages lie. We are dismayed to learn that the container terminal is now to be moved to Nqura port, which opens up great risk for KZN’s investment profile,” he said.
Ward said the Chamber acknowledged the President’s comments on tackling the issue of corruption. He said corruption and state capture are serious economic crimes in South Africa that significantly exacerbates socio-economic challenges. “However, until the criminals involved in state capture and corruption suffer severe consequences for their acts of economic sabotage, then there will be no real change in the status quo,” he said.
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